Study Confirms Preference for Human Advice Over Robo Advice

0

A study released by the MDRT organisation affirms that consumers want technology to complement, rather than replace human financial advisers.

MDRT President, Ross Vanderwolf … the majority of clients still desire human interaction and communication

The research findings are based on a survey of two thousand American consumers, which examined:

  • What consumers think of technology in financial services
  • Clients’ perspectives on robo advisors
  • The technology clients expect their adviser to incorporate

The research revealed that, irrespective of whether they currently use a financial adviser, about the same percentage of Americans in each group agree it is important that advisers are both technologically savvy (95 percent each) and use updated technology-based tools in their practice (96 percent who have an adviser and 95 percent who don’t).

88 percent of Americans say technology should complement, not replace, the services of a human financial adviser…

Other findings included:

  • 88 percent of Americans say technology should complement, not replace, the services of a human financial adviser
  • 85 percent of Americans say they prefer working with a human financial adviser rather than a robo adviser
  • Only five percent of Americans believe financial planning should be managed entirely by technology-based tools
  • 36 percent strongly disagree that robo advisers could completely replace the role of human financial advisors in financial planning
  • While 83 percent would trust a human financial adviser to effectively manage their financial plan, only 36 percent would trust the job to a robo adviser

Considering the top benefits Americans cite for working with a human financial advisor over a robo adviser:

  • The opportunity to build a trusting relationship (65 percent)
  • The high level of human interaction (58 percent)
  • Ease of communication (52 percent)

On the flip side, the main concerns of working with a human financial adviser were found to be:

  • Cost (47 percent)
  • Response time (32 percent)
  • Accuracy of assessments (31 percent)
…the majority of clients still desire human interaction and communication

Commenting on these findings, MDRT’s global President, Queensland adviser, Ross Vanderwolf, noted, “Though robo advisors have become more prevalent in the financial advisor industry, it’s vital to note that the majority of clients still desire human interaction and communication… This means that we, as financial professionals, should make every effort to cultivate client relationships in order to further promote the benefits of working with a human advisor.”

Reinforcing Vanderwolf’s comments, MDRT First Vice President, US adviser, Regina Bedoya, added, “This study suggests Americans have not outgrown human advisors; instead their preference lies in combining the personal and trustworthy touch of an advisor alongside cutting-edge technology.”

Click here to access an infographic image that summarises the key findings from this US study.